AI, tech and the two-pot retirement system headline InsureTalk44

InsureTalk44 took place on Thursday, 11 July 2024. Talk focused mainly on AI and technological advances in the insurance industry.

The headline sponsor for the day was Discovery Insure, who fielded three speakers to share their wisdom on a number of topics (including AI).

First in the hot seat was Discovery Insure’s Darryl Grater. Darryl discussed the current trends and complexities in the insurance industry, highlighting significant factors such as political instability, inflation and evolving reinsurance structures. He emphasised the increasing frequency and severity of weather-related events and their substantial impact on claims and costs.

“Insurers need to re-look the pricing for these catastrophes, considering their frequency, as well as the rising cost of reinsurance and reinsurance reinstatements, which is materially different now versus 10 years ago.”

Darryl also addressed the importance of maintaining infrastructure, adapting to changing vehicle theft trends and managing technological risks associated with AI advancements.

“The insurance industry is now using AI for personalised marketing based on specific characteristics and shopping behaviours,” he said. “This raises privacy concerns and risks like deep fakes leading to more convincing frauds.”

He pointed out that banks have actually stopped using voice verification due to AI mimicking voices. “Insurers must also strive to adopt more stringent verification protocols and enhance AI technology for competitive advantage.”

He underscored the role of financial advisers and brokers as being vital in this environment, helping clients understand risks and ensure proper coverage.

“The evolving risk environment requires insurers to adjust reinsurance models and pricing,” he said. “Advisors play a crucial role in guiding clients through these complexities, emphasising the need for dynamic, value-driven insurance products and maintaining infrastructure against increasing weather-related claims and vehicle theft trends.”

Darryl was followed by his Discovery Insure colleague Michael Rodewijk, who took the AI discussion further.

“AI is a significant trend in insurance, often misunderstood for its power and capabilities,” he said. “It’s crucial to understand AI’s actual impact on the insurance space.”

Recent AI advancements allow for more generalised tasks to be performed, increasing efficiency and service personalisation.

“Machine learning and natural language processing enhance tasks like fraud detection and customer communication,” he said. “And yes, AI can streamline processes, reduce costs, and improve customer experiences, but it also raises privacy concerns and the risk of misuse, such as deep fakes. Insurers must adapt to AI’s opportunities and challenges, ensuring secure and efficient operations.”

Michael showed how Discovery has integrated AI in various applications, enhancing personalised experiences and operational efficiency. Key uses, he said, include AI quotes from competitor schedules, pothole patrol prioritisation and chatbots for customer queries.

“AI-driven tools also assist employees with tasks like summarising information and generating emails,” he added.

The future of AI in insurance involves multimodal inputs and collaborative AI agents, promising improved customer service, reduced costs, and lower premiums. Michale said employees will need to adapt and develop new skills to work effectively with AI.

IISA CEO Thokozile Mahlangu was up next. She unpacked five topics of discussion –

• The agenda for 50^th AIE, including the fact that 702 will be broadcasting live from the conference at Sun City
• The debit order facility for paying for your IISA membership
• The launch of the second cohort of the YAP – the youth accelerator programme – in the next few weeks. Thokozile called on the industry to host young professionals as part of the programme.
• Webinars and seminars, which are free to members. Customised programmes are also available.
• A call for corporate partners to nominate team members to participate in one of the IISA’s skills development programmes – specifically the digital insurance course and the mini-MBA.

His talk started by spelling out retirement practices around the world, with specific notes on France (where the retirement age recently changed from 62 to 64 – to much protest), China, USA and South Africa.

Yasheen highlighted the shift to a more balanced retirement fund approach, addressing both immediate financial needs and long-term savings.

He emphasised the historical context, benefits for employees and employers and the system’s potential to improve retirement outcomes significantly. He also touched on implementation challenges and the importance of informed decision-making using tools like Discovery’s two-pot calculator.

“Retirement is no longer just about retirement,” he said. “Members must be aware of the most important element of their retirement plans.”

There is no pressure on anyone to take any action at all, he stressed.

“We’re not encouraging retention and we’re not encouraging withdrawal. We are saying, understand your situation and do what is best for you.”

He concluded by presenting the case study below, which shows the consequences of withdrawing versus staying invested:

FA News editor and founder of The Insurance Apprentice, Rianet Whitehead, opened her traditional slot with some Insurance Apprentice news.

“We’ve celebrated year 10 of The Insurance Apprentice… and taken the competition to the next level!” she said. “We are currently in talks with a television station and, if all goes according to plan, we will be on TV next year – when the prize money will be significantly increased.”

Rianet shared a snippet from the about-to-be-launched podcast called TIA Talks. Look out for it on the TIA socials and podcast platforms.

She thanked the industry for their positive comments on the direction FA News is taking, including daily newsletters, CPD articles, high quality content.

On the insurance news front, Rianet highlighted the demand for more affordable, innovative products. Tech is major force – the pace of change will increase!

As the formal part of the proceedings wrapped up, the CN&CO Events team played a promotional video for the upcoming InsureTalk Live session, which takes place in Johannesburg on 19 September 2024. There are only 100 spots available. You can register for this premium, not-to-be-missed event at www.cnandcoevents.com.

To view the entire InsureTalk44 session, click on the video link below:

And to register for InsureTalk45, which takes place on Thursday, 22 August 2024, click here. Remember, you will earn 2.5 CPD hours for attending. IISA members’ CPD certificates will be posted on the InsureTalk portal.